The Monetary Authority of Singapore (MAS) plans to raise S$2.6 billion (US$1.92 billion) through its first-ever bond sale under the Significant Infrastructure Government Loan Act (SINGA). Proceeds will be used to finance major infrastructure projects, which could include additional rail lines and coastal protection infrastructure to protect the country from rising sea levels.

Singapore’s legislature passed the law in May 2021, permitting the government to borrow up to S$90 billion (US$66.59 billion) over the next 15 years. The SINGA bond sale represents the first time in four decades that Singapore will borrow to finance infrastructure projects, after capital initially set aside for them was reassigned to help the country fund programmes to battle the effects of the Covid-19 pandemic on the local economy.   

The yield on the bond, which is set for maturity on October 1 2051, will be announced by MAS an hour after the auction on September 28. The bond will also be issued for trade in the secondary market on October 1.

Retail investors can subscribe to the bonds through local lenders DBS/POSB, OCBC and UOB with a minimum of S$1,000.

Against the backdrop of growing concerns about Chinese real estate giant Evergrande’s bond interest payments, the high-quality Singaporean bonds, supported by  Singapore’s AAA credit rating, should prove an attractive option for investors.